The Hindu Business Line : `Govt thrust vital for hardware sector'

Mr Ajay Chowdhry (right), Chairman and CEO, HCL Infosystems, with Mr Walter Van West, Chairman of the Intec group, at the inaugural ceremony of the `India e-Hardware' Summit 2004 organised by CII in Hyderabad on Friday. - A. Roy Chowdhury

Hyderabad , Nov. 26

THE Government needs to adopt a multi-pronged strategy that seeks to boost the domestic hardware sector, complimenting the steady growth of the software services, to gear up to the challenges of the WTO (World Trade Organisation) regime.

The Chairman and Co-Founder of HCL Infosystems and the Executive of MAIT (Manufacturers Association for Information Technology), Mr Ajai

Chowdhry, said, "India is committed to the IT agreement of the WTO to implement the zero-duty regime. This has impacted the industry and called for concerted effort by the Government and the industry to face the challenges."

Mr Chowdhry said a CII-McKinsey study had projected that the Indian hardware industry, ranked pretty low now, has the potential to become one of the top five by 2010 with necessary thrust.

"It is projected that China, given its infrastructure and the current pace of growth, could possibly contribute to about 56 per cent of the world PC production in the next few years. This is both a warning as well as a necessity to address the neglected hardware sector. Though the Government had appointed a task force for the hardware sector, nothing has come out of it. Therefore, we, at MAIT, have come up with an agenda to boost the sector," he said.

Advocating restructure of the Electronic Hardware Technology Park programme, Mr Chowdhry suggested standardisation of VAT, exercise and customs duty structures along with local taxes. MAIT favoured 100 per cent depreciation for computers as this will encourage corporates to purchase new systems and the PCs, thus freed, can be used in education and in the rural parts of the country.

The Chief Minister, Dr Y.S. Rajasekhara Reddy, said the Government would go all out to help the hardware sector and cited the case of an ambitious project to locate a semiconductor fab base in Hyderabad.